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Best Penny Cryptocurrency to Invest in 2022, Is WBTC the Same as BTC?

Let us begin by defining what a penny cryptocurrency is. If you are familiar with the stocks market, you probably have heard about penny stocks. The term ‘penny stock’ refers to an asset that one can purchase for a few pennies, usually less than $5. Analogously, you can buy a penny cryptocurrency for a few cents per coin.

Penny cryptocurrencies can be excellent investment vehicles since you do not need much money to invest in them. Over time, a penny cryptocurrency may appreciate significantly, giving the investor a considerable return on investment (ROI). However, this type of investment is highly risky. In most cases, penny cryptocurrencies have low market capitalization. A coin with a low market cap is prone to collapse at any moment.

It doesn’t mean you should not invest in penny cryptocurrencies. If you choose the correct penny cryptocurrency, you can get enormous gains from a modest investment. There are different criteria to assess the growth potential of a penny cryptocurrency. We will give you some tips about it so you can choose the best penny cryptocurrency to invest in 2022.

However, if you want to start investing in this type of digital asset right away, you can pick a cryptocurrency from this list:

  • Shiba Inu (SHIB)
  • VeChain (VET)
  • Stellar (XLM)
  • Cardano (ADA)
  • Hedera (HBAR).

These penny cryptocurrencies are promising, but some of them are highly volatile. Always research a coin thoroughly before you make an investment decision about it.

How to Choose the Best Penny Cryptocurrency to Invest In

To select a penny crypto that can be a promising investment, you should pay attention to several points:

  • A large circulating supply of no less than 10 million coins or tokens.
  • At least 25% of the total supply must be already mined or issued.
  • A high market capitalization of no less than $20 million.
  • A decent trading volume of at least $1 million daily.

The above list will help you weed out digital coins that may be worthless. It is also recommendable to check whether major exchanges list the coin of your interest. If possible, find information about the development team of the coin you want to invest in. A team of crypto experts is more likely to take a project to a good completion.

What Cryptocurrency to Buy for a Safer Investment?

All cryptocurrencies are inherently risky as investment vehicles. However, most experts and crypto enthusiasts agree that Bitcoin (BTC) is one of the safest investments. Also, Ethereum (ETH) is a safe investment to a lesser extent. You can use BTC on the Ethereum ecosystem with the so-called Wrapped Bitcoin (WBTC). It is a tokenized version of BTC, and you can exchange WBTC to BTC or the other way around at a 1:1 exchange rate.

Strictly, WBTC and BTC are not the same. Wrapped Bitcoin is an ERC-20 token that runs on the Ethereum blockchain. In this way, WBTC fully integrates into all the services of the Ethereum platform like crypto lending, decentralized exchanges, and various decentralized finance (DeFi) applications. Because of the complexity of performing cross-chain crypto swaps, WBTC is an excellent alternative to operate with Bitcoin on the Ethereum ecosystem.

A 1:1 reserve of BTC coins backs wrapped Bitcoin to keep its price pegged to Bitcoin. Wrapped Bitcoin was publicly released on January 31, 2019. Since then, this cryptocurrency has enabled the utilization of Bitcoin in more advanced applications like smart contracts. Bitcoin is a first-generation blockchain, old technology by today’s standards. Wrapped Bitcoin opens the doors to all the benefits of the new developments brought by Ethereum 2.0.

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